Understanding the Role of Immigrants’ Legal Status: Evidence from Policy Experiments

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. www.econstor.eu Programs aimed at reducing the presence of unauthorised immigrants are often at the core of the migration policy debate in host countries. In recent years, a growing body of empirical literature has attempted to understand the effect of lacking legal status on immigrants' outcomes and behaviour. The main difficulties in this field are the scarcity of data and the identification challenge posed by endogenous selection into legal status. The vast majority of these articles have therefore used amnesty programs (or similar policy changes) to establish causal relationships. In this paper, we propose a first systematic review of the empirical literature for the US and Europe on the impact of legal status on different immigrants' outcomes. We then present some new evidence of the relationship between labour market outcomes and legal status in the Italian context. In our empirical analysis, we first provide some descriptive evidence on differences in the outcomes for groups with different residence statuses, and we then exploit a specific amnesty programme to produce causal estimates of the impact of legal status. Our results confirm previous findings in the literature and show that the design of the specific amnesty analysed matters in shaping its effects. Terms of use: Documents in D I S C U S S I O N P A P E R S E R I E SJEL Classification: F22, J61, K37

What are the consequences of regularizing undocumented immigrants?

“…Wage increases resulting from employment-tied regularization may not arise in the short term, but only several years later, after employment contracts expire and workers are finally mobile. Findings on the 2002 Italian regularization policy in the years immediately after regularization are consistent with this problem [10]. However, these types of policies may still lead to higher wages for workers that remain in the same jobs, if those jobs transition from the informal to the formal sector.…”

How Do Regulated and Unregulated Labor Markets Respond to Shocks? Evidence from Immigrants During the Great Recession

“…4 Second, we contribute to the literature on market outcomes of documented and undocumented immigrants. There are works showing how undocumented immigrants have on average worse labor market outcomes than documented immigrants (see, e.g., Borjas and Tienda (1993); Kossoudji and Cobb-Clark (2002); Kaushal (2006); Amuedo-Dorantes et al (2007);Fasani (2015); Monras et al (2018)). This effect of legal status on labor market outcomes may be related to the restricted set of job opportunities for undocumented immigrants or their bargaining power relative to employers, which is lower than the one of immigrants with a regular residence permit.…”

“…16 The latter percentage is consistent with the descriptive statistics of 14. See Fasani (2015) and Dustmann et al (2017a) for a more detailed description of these data. Mastrobuoni and Pinotti (2015) also use data from the ISMU survey.…”

Substantial Labor Market Effects of the Residency Status: How Important Are Initial Conditions at Arrival for Immigrants?

“…Prior research to date focused on the wage differentials between legal and illegal migrants (for the United States, see, e.g. Koussoudji and Cobb-Clark, 2002;Amuedo-Dorantes et al, 2007; for Italy see Devilannova et al, 2014;Fasani, 2015;Dustmann et al, 2016). Labor market effects between different legal statuses attracted, however, less attention, mainly due to a lack of data.…”

“…Nevertheless, a few studies do exist. Fasani (2015) evaluates an amnesty in Italy in 2002, aiming to assign a two-year working and residence permit to undocumented immigrants (see Devillanova et al (2014) for more details about requirements and the adoption of the law). Taking advantage of this exogenous enacted law that enables causal interpretations, Fasani (2015) only finds small and marginally significant effects for the period of 2003-2004.…”